- Wednesday 21 April 2010
Sunshine Coast Council has a positive financial and investment performance position with expenditure under budget and in excess of $10 million of the targeted $13 million efficiency dividend realised.
Council’s Finance Management Portfolio Councillor, Chris Thompson said today that at 31 March, council’s operating result shows the organisation with $15.4 million or 21.9% better than forecasted operating position.
“The key contributors to the positive result are that employee costs are under budget by $2.4m or 2.0% and materials and services costs excluding capital works continue to track under budget at $16.4m or 11.8%,” Councillor Thompson said.
“However, these underruns are masking year to date overruns in the cost of water $2.1m and electricity $1.5m,” he said.
“The budget was not increased in the last review for these overruns due to the significant underspend at the corporate level for materials and services.”
“At the end of March 2010, $10.3m or 76.7% of council’s $13.486m efficiency dividends were declared, so with the financial year 75% complete, council remains on track to achieve its dividends.
“The investment market over the past three months has seen increases in the official cash rate steadily increasing from 3% in October through to 4.0% as at 31 March.
“On some occasions the market has anticipated increases and moved ahead of the Reserve Bank of Australia; whereas on other occasions, the market has lagged behind the Reserve Bank announcements but overall council’s performance is well above indicative benchmarks.”
“Funds available for investment peaked towards the end of February, seeing significant deposits held, and now as funds are expended, term deposits and cash balances are being steadily drawn down as capital works projects and operational requirements are met from available funds.”
“Throughout the period in question, all term deposits purchased have been with institutions having a minimum AA long term credit rating, and all providing competitive market rates.
Cash deposits with Queensland Treasury Corporation and Commonwealth Bank have been capital guaranteed, and therefore the risk to council has been minimised.
Today’s report considers the Financial Performance Report, the Capital Expenditure Statement, Schedule of Capital Reallocations, and the Schedule of efficiency dividends.